Potential Conservative welfare cuts revealed in leaked emails

A range of welfarebenefits are potentially facing the axe or severe restrictions by the Conservatives after the general election, according to emails seen by the BBC.

The cuts suggested by officials include restricting child benefit so it is payable only for the first two children, and scrapping the industrial injuries benefit by passing the costs on to firms.

Emails seen by the BBC suggest that if companies do not have an insurance policy, they will become members of a default scheme and pay a levy to fund it. Axing the industrial injuries compensation scheme could save £1bn.

Restricting child benefit so that none is paid for the third or subsequent children could eventually save £1bn, but only modest amounts initially.

Other proposals aired by Department for Work and Pensions (DWP) staff include a regional benefits cap, taxing disability benefits and reducing eligibility for the carers’ allowance.

The Conservatives have said they want to cut £12bn from the welfare budget by 2017-18, but have indicated they will probably not set out any details as to how they intend to do so until after the election.

David Cameron, when interviewed by Jeremy Paxman on Thursday, declined to set out any details, referring only to a proposal to freeze in-work benefits.

The Conservatives responded to the BBC leak by insisting the proposals were not party policy.

“This is ill-informed and inaccurate speculation,” a spokeswoman for the work and pensions secretary, Iain Duncan Smith, said.

“Officials spend a lot of time generating proposals – many not commissioned by politicians. It’s wrong and misleading to suggest that any of this is part of our plan.”

The leaked documents were prepared by civil servants and commissioned by Conservative party officials, the BBC said.

But a Tory spokeswoman said it was not clear the proposals had reached ministerial offices, and suggested they might be part of a wider set of contingency thinking ordered by the cabinet secretary, Jeremy Heywood. Collectively the cuts would save around £5bn, showing how ambitious it may be for ministers to reach the £12bn target.

The shadow work and pensions secretary, Rachel Reeves, said: “These plans to hit the disabled and carers were drawn up for Conservative ministers to deliver their extreme cuts plan.

“The Tories now need to come clean about what cuts they plan to make and who will pay the price. If they are ruling out these extreme cuts for the most disabled and carers, then it is clear they will be hitting the tax credits, and support for children, for millions of working families.”

The prime minister has already discussed cutting the maximum amount in benefits a household can receive from the current £26,000 to £23,000.

According to the BBC, a proposal to restrict the carers’ allowance to universal credit claimants could save £1bn, with 40% of existing claimants losing out.

The taxing of disability benefits could save up to £1.5bn a year, according to officials, reducing the income of those whose incomes exceed a tax threshold.

Removing the contributory element of job seekers allowance and employment and support allowance would save money because claimants who had made sufficient national insurance contributions could receive the benefits with minimal means testing. An analysis by the DWP suggested 30% of claimants, more than 300,000 families, could lose about £80 a week but the money saved would reach £1.3bn in 2018-19, the BBC said.

The proposed £23,000 total benefit limit could vary in different parts of the country, with Londoners receiving the top amount because of the higher cost of living in the capital.

Rosanna Trudgian, policy officer at the charity Mencap, said the proposed changes were unfair. “Disabled people don’t choose to have their disability. They don’t choose to pay for these additional costs related to that disability. For example, if you have to go to hospital on a regular basis and you are paying for those huge car parking fees. Therefore, it’s just unfair if this is treated as taxable income.”